The Granite State is one of the most flexible states in the nation (consider it’s the only state that doesn’t require car owners to have auto insurance). With low (or no) taxes and a live-and-let-live attitude, business owners have a lot of leeway to experiment as they get established.
New Hampshire has just over 1.4 million people in the state and, while job growth has recently stalled, it retains a strong foothold in manufacturing, healthcare, and tourism. Here, we’ll look at the available opportunities for business owners, so it’s easier to make smarter choices as you go along.
The steps:
- Fine-tune your business idea
- Create a business plan
- Choose a business name
- Choose a business structure and register your business
- Set up banking, credit cards, and accounting
- Get funding for your New Hampshire business
- Get insured
- Obtain permits & licenses
- Find your team
- Market and grow your business
- Open the doors!
1. Fine-tune your business idea
No matter how solid your business idea is, nailing down the specifics may feel daunting. Taking it step-by-step can help you avoid common pitfalls that can cause businesses to go under before they even have the chance to get off the ground.
Local demand
Your value proposition has to fit in with the local demand, and this is true whether you’re catering to wealthy NYC couples escaping the grind or cash-strapped college students.
New Hampshire’s business climate may not be as saturated as other states, but the flipside is that you don’t have endless crowds of people to fill in the gaps. The best businesses start by building their relationships, and that all starts with filling a niche that people actively need.
Understanding the sectors
Adapting your business idea to different sectors may mean rethinking your skill set. So, if you have plenty of experience in food service, research anything from vending machines to upscale catering companies. Depending on the location, they may get more traction than opening up a traditional restaurant in the area. Not only should you spend some time in different neighborhoods, but you should also chat with locals from different geographic areas to better sense their pain points before you make the wrong assumptions.
2. Create a business plan
When you create a business plan, it should lay out more than just your business model. We recommend tackling each step as best you can and visiting our links for more information as you map out everything from ideal customer personas to grant opportunities.
Market research
Your customers are more than just a socioeconomic profile. While average salary, age, and background are important, market research reveals the deeper motivation that drives their decisions. Accurate market research can help you see where and how your business can meet customers where they are — and this is true even if you’re introducing a new idea or concept.
Financial plan
Financial planning in the initial stages may feel akin to ‘fake numbers’, but that doesn’t mean you can make wild guesses either. As a general rule, business owners have a tendency to underestimate expenses like rent, supplies, and salaries, and overestimate their projected profits.
If you strive for more realistic figures, it’s easier to catch financial mistakes before they have the chance to unfold. So, instead of leasing an office in the heart of downtown Portsmouth, you might look for space in a more affordable suburb. Your financial plan should include both upstream costs, like straight overhead, as well as potential downstream costs, like the threat of litigation if you’re more vulnerable to lawsuits.
Marketing plan
Your marketing plan doesn’t have to be elaborate or expensive, but it should detail how you plan to get the word out. This could mean calling friends and family, distributing flyers in communal spaces, or handing out your business card with a free sample of your product.
Marketing for small businesses should scale alongside your clientele. In other words, you may not want to blow your budget on complex campaigns before you have a solid customer base. You can always expand your marketing as you gain more momentum, so feel free to make a wish list during this phase about what you’ll do when you have more resources!
Choose a location
The cost of space can range in New Hampshire, but overall, it’s a relatively modest place to rent or buy. Of course, the right location for you is more than just square footage, you also have to consider the relative opportunities of each space.
Cities like Dover, Exeter, and Portsmouth may be more expensive, but they also may be your ticket to more foot traffic.
For example, if you’re opening a coffee shop or a convenience store, you’ll likely need plenty of impulse customers who happen to wander by. If you’re offering a professional service, like legal advice or tech consulting, you can potentially set up further outside the main drags.
Regardless of where you choose, keep in mind:
- Permits: Permits in New Hampshire are fairly straightforward, and you usually only need them if you’re selling food, liquor, tobacco, or communication services (e.g., wifi coverage, etc.). Standard retailers won’t need a seller’s permit because New Hampshire doesn’t have a sales tax.
- Zoning: Zoning laws depend on the neighborhood, meaning you’ll need to know how space is zoned and whether that impacts anything from parking spaces to storage solutions. For example, if the zoning laws allow you to use your shop’s basement to keep additional stock.
As you search around different neighborhoods, keep in mind that location can greatly influence how long it takes for you to get your business off the ground. For example, a liquor license may take several months to be approved depending on the city or town.
Decide if you’re an online-only business
As you look at office or retail prices in the state, it’s worth comparing the benefits of opening an online or a hybrid business. If you do decide to move your business online, you’ll follow the same process as a standard business.
However, you’ll also need to comply with the state’s data privacy laws. This usually means setting up more transparent agreements with customers, such as explicit consent for marketing communications, and protecting yourself and your customers with effective cybersecurity, such as firewalls and encryption.
If you do open an online-only business, it’s important to have a supply and distribution plan for stock, a user-friendly website for customers, and strong social media profiles. Instead of only setting up Instagram or TikTok accounts, explore additional platforms like Google My Business and Facebook Marketplace.
If you choose to open a hybrid business, make sure you set reasonable expectations for volume. For example, if you run a kitchen supplies store, you might sell half your stock in your retail space and the other half online.
3. Choose a business name
Even the most promising new businesses start at a distinct disadvantage—little to no name recognition. A good business name is usually more than just a basic description of what you do. It’s important to leave people with a strong impression of the value you bring to the table, and you may only have a few words to do it.
Branding
First things first, your name should fit the general brand. So, if you’re planning to ditch the standard trappings of the corporate world, don’t be afraid to let your name reflect that.
Just keep in mind that your business may need to change over time to accommodate customer demands. So, you may start off catering to luxury homeowners only to find that your product has more appeal to a middle-class market. You may want to build in some flexibility into your business name so you don’t have to start from scratch if you do need to change tack.
Doing Business As
Legally, you can establish multiple names for your business: an official business name and a public-facing name. Known as Doing Business As (DBA), there are a couple major benefits of going this route:
- You can choose a more formal name for formal business matters, like Joe’s Handyman Services, and a DBA name for your customers, like Drill Sergeant.
- You can use DBAs to specify different products or services while still operating under the same umbrella, like Joe’s Window Hanging Services and Joe’s Picture-Hanging Services. You can also use the same strategy for locations. If you want to operate in different cities, you can work the city name into your DBA New Hampshire.
Legalities
To keep yourself out of legal hot water, make sure you search for your business name in state databases using a NH business lookup. This not only helps you avoid being sued for a trademark dispute, it also keeps customers from confusing your business name for another business.
4. Choose a business structure and register your business
Business structures ultimately determine how much you spend every year and what you’re liable for under your business’ umbrella. Unfortunately, they tend to get confusing fast, and that’s usually because the rules are more complicated than they might first appear. Here, we’ll look at some general tips to keep the legalities straight (including pros and cons of filing for taxes).
Sole proprietorship/partnerships
Both sole proprietorships and partnerships are low-cost and straightforward, meaning you don’t have to wrestle with complicated forms and legalese that could lead to a costly error in the White Mountain State.
The downside is that you’re liable for everything in your business, including any debt or litigation costs. With a sole proprietorship, you operate as an island, meaning you take on all responsibility and liability. With a partnership, you share the responsibility and risk among two or more people.
Tax considerations
Taxes are fairly straightforward with both of these options. In fact, many business owners just lump their finances into their personal taxes. This can be extremely helpful if you’re just starting out (without a bookkeeper) and taking in a relatively modest income. As long as you’re keeping up with the general expenses and profits, it should be fairly easy to input the numbers so you can settle up with the US government.
Corporations
A corporation is known as a separate legal entity, giving you the ability to write your own rules and take on debt without risk to your personal assets. Corporations are largely recommended for businesses with very ambitious goals, like going public within a year.
Tax considerations
A corporation is often more heavily taxed and, at the highest levels, corporations are double-taxed for both their profits and their dividends. Taxes can often get complicated quickly, and most business owners will need a dedicated accountant to avoid error.
Limited Liability Company
An LLC is a hybrid structure, limiting your liability (like a corporation) while still giving you a simple filing structure (like a sole proprietorship). When it comes to registered small businesses, starting an LLC is the most common structural form.
Tax considerations
The main tax advantages for an LLC is that it can offer some of the same simplicity as a sole proprietorship. The catch is that the rules and accounting strategies can vary based on anything from industry to yearly profits, so it may be worth springing for an accountant if you don’t want to get caught up in a complex financial web.
Registration
It’s approximately $100 to register a business with the Secretary of State. If you’re filing for a DBA, it’s approximately $50 with a renewal fee every five years.
5. Set up banking, credit cards, and accounting
Setting up business finances is really important to a new business because it sets the stage for the rest of your operations. All the ancillary costs that you didn’t expect, whether it’s minor office repairs or tips for a delivery driver, can add up fast. In some cases, you can just keep running tallies in your personal accounts, but for most people, it helps to open a business account so you’re not mixing up your money.
Banking
What do you need to open a business bank account in New Hampshire? It depends on the type of business that you’re running and the bank that you choose. For example, if you’re running a sole proprietorship, you can use your home address as your business address and your Social Security Number (SSN). However, if you have an LLC or a corporation, you’ll need an Employer Identification Number (EIN) issued by the IRS.
Banks will also ask for official documentation, including your government-issued ID. As for additional proof, you may need your official articles of formation or company bylaws. But again, it varies by financial institution.
Credit cards
Credit cards can help you open doors to additional assets, and they can give your employees more flexibility to make time-sensitive decisions. To open a credit card, you’ll need a business address, government issued ID and your EIN or SSN.
Accounting
Some business owners will feel comfortable doing their own accounting, whether because they feel comfortable with numbers or because they want to save money. However, you may want to look into getting professional support, whether via tax software or a professional, just in case your finances get messier than you anticipated.
6. Get funding for your New Hampshire business
The available funding for any new business depends heavily on where and when you open it. Because opportunities like New Hampshire small business grants and investments can shift based on anything from sector needs to economic strain, it’s important to stay flexible as you explore every avenue.
Loans
If you’re opening a nonprofit business, the New Hampshire Business Finance Authority works with the New Hampshire Community Development Finance Authority to offer low-interest and deferred loans. You can also explore the Community Loan Fund or the Small Business Administration for loan opportunities for reasonable repayment terms and conditions.
Support organizations
Support organizations in New Hampshire may offer anything from funding opportunities, like low-interest loans, to entrepreneurial advice and guidance — which can drive long-term financial opportunities. Just keep in mind that these organizations cater to different types of businesses.
For example, the Hannah Grimes Center for Entrepreneurship offers rural small business owners an incubator environment, including connections and resources. You can also explore the Small Business Development Center (for general small businesses), the International Trade Resource Center (for global exporters) and the Charitable Foundation(for nonprofits).
Tax credits
New Hampshire issues tax credits, which can help you reinvest profits in the business, including the Research and Development for heavy R&D costs, the Economic Revitalization Zone for businesses improving state infrastructure and the Coos County Job credit for small business owners in the county who pay their employees 150% more than minimum wage.
7. Get insured
The White Mountain State is notoriously hands-off when it comes to insurance. However, there are a few things that you should know about state laws and liability:
- Commercial auto insurance: Certain industries, like trucking, are required to have commercial auto insurance. Just keep in mind that if you choose to forego auto insurance, you’ll need to demonstrate that you have enough financial funds to cover your liability in an accident.
- Workers comp/unemployment: If you have employees, workers comp ensures that you can pay for costs, which may include anything from lost wages to medical bills, for injuries that occur on the job. You’ll also need to pay into the state’s unemployment insurance fund (even if you just have part-time employees).
- Liability: Liability insurance is typically not required by the state, though it may be required for partnerships and contracts. It’s important to consider how you’ll cover errors (whether it’s an unsalted walkway or incorrect advice).
- Commercial insurance: Commercial insurance may not be required, but you may want it to cover your physical assets, like your equipment and furniture, from natural or man-made damage.
If you have more questions about different types of insurance, the state has an Insurance Department that can walk you through different types of coverage so you can find the right protections for you.
8. Obtain permits and licenses
Your New Hampshire business license and permits are largely determined either at the federal or the local level, and may include:
- Local business license: Depending on the region, you may need a license to operate within specific borders.
- Food permit: Typically required for any businesses that handle or sell food.
- Professional licensing: You may require a current professional license to operate. The Office of Professional Licensure and Certification is a government-run organization for more than 50 licensed professions.
- Tax licenses/permits: Certain sectors, like communications services and tobacco, may need a license or certificate to legally operate.
Federal income tax and New Hampshire local tax
New Hampshire has two main taxes for businesses, known as the Profit and Enterprise tax. With no general sales or personal income tax, the profits tax imposes an annual percentage (currently 7.5%) for taxable periods for any business that exceeds a gross business income (currently $109,000).
The Enterprise tax is an additional fee (currently 0.55%) for businesses exceeding a certain threshold of gross receipts (currently $298,000). Additional taxes may include the Meals and Rooms tax, imposed on hotel, restaurant, or vehicle rentals, or standard commercial property tax based on neighborhood.
All New Hampshire businesses are subject to federal tax laws. It’s important to research laws for more than just your general type of business structure. Federal and state governments alike may offer more leeway than you realize to better organize your tax reporting so it leaves you with enough to keep the business going (without breaking any federal or local laws).
9. Find your team
New Hampshire is a community-driven state, so your business’s ecosystem should mirror that of the larger area. If you’re not prioritizing your team, it’s easy to end up with the kind of turnover that turns customers off over time.
People are the backbone of the business
People are at the center of your business, so it helps if they support and believe in your bigger mission. Whether that’s to bring customers the best cup of coffee in the area or to spread renewable energy to homeowners, this shared anchor can serve as a strong foundation to build strong relationships. Whether that’s with your business mentor, contractors, or customers, it helps to treat everyone as the asset they are.
And nowhere is this more true than with your employees. When your staff serves on the frontlines, it’s crucial to recognize how their everyday interactions translate into success or failure. Rewarding them for their time and talents is by no means inexpensive, but you may be far better off spending a little more now to avoid the dismal fate of so many small businesses.
Comply with New Hampshire payroll regulations
Payroll regulations include paying the minimum wage of $7.25 per hour, as well as overtime at 1.5 times the rate over 40 hours. Pay should be weekly or biweekly. and must be paid within 8 days of the week’s end for weekly and within 15 days of the end of the period for biweekly.
Hire contractors
Contract employees can include anyone from temps to cover a one-off event, like a launch party, to professional retainers, like an accountant during tax season. Contractors can make strong contributions to your business, particularly if they keep you out of legal trouble. For example, a lawyer on retainer may alert clients to a new zoning law, which can help small business owners prevent inadvertent violations.
Some business owners also hire specialty consultants to keep them abreast of how consumer demands and federal regulations shift inside any given sector. Again, this type of contractor makes it possible to stay ahead of the game, which is always valuable for a small business owner competing against global market forces.
10. Market and grow your business
Marketing before you open is more than creating sensational buzz. If you really want to grow your business, you should set off to nurture your customer base from the very beginning.
Mailing lists or newsletters
Before you open, you can generate interest with anything from social media ads to community event attendance. Ask prospective customers to sign up for direct mail or newsletters, and then use that list to deliver valuable information about when you’re opening and what your business plans are. This is also a good time to ask customers if they have feedback about your business, so you can better gauge what they’re looking for.
Consider making special offers to attract new customers
Special offers and deals have always been an effective way to entice customers because they tempt people to break out of their old habits with a new product or service. However, given the level of competition in nearly every sector, it’s important to set well-intentioned special offers and to advertise them in the right way. Don’t just consider your general customers’ needs, but also how your competitors engage and retain the same base.
The value of paid ads
Paid online ads are an additional marketing expense, but they do help you skip to the top of the search engine. Paid ads are usually best used as a temporary measure only — just until you can get enough online traction to organically shoot up the list. So, you might pay for the keyword search “best solar panel company in Exeter” for the first three months to get more initial exposure.
Look for local businesses or brands to collaborate with
New Hampshire doesn’t have the same cut-throat feel you might find in bigger cities with endless competition. Whether you’re catering to college students in Hanover or the families in Durham, consider asking your fellow professionals if they’d like to team up on a project.
For example, if you’re opening a neighborhood bar, you might ask the pizza store next door if they’ll do a pizza + beer special during your first three months. This doesn’t just give customers a reason to associate the two brands together (which can be especially useful if you’re working with mainstay businesses), it’s also an easy way to promote mutual goodwill within the larger business community.
Invest in word-of-mouth
No matter how many centuries go by, word-of-mouth remains one of the most powerful marketing tools — whether it’s a friend telling a friend or a Yelp review telling the world.
If you want good word-of-mouth marketing going before you even open, consider tapping into your social media accounts to promote your opening day, quality products, or professional expertise. Or you can ask friends and family to spread the word, whether that’s at their workplace or on their own social media accounts.
Create unique and helpful content to showcase your activity
Good content includes anything from your social media graphics to your direct mail flyers. Make sure that it draws in your customer by providing the solution to a key pain point or addressing a personal preference. For instance, a new landscaping company might create newsletter content about how often to water your lawn in a particular area. This way, they establish a helpful brand persona before they start pitching their services.
11. Open the doors!
Whether it’s your digital or literal doors, now is the time to get up and running.
Plan a successful launch event
Launch events can be anything from a first-day toast with your employees to a massive community event thrown in the town square. Whatever you choose to do, remember that all businesses can benefit from a celebration — even B2B companies within a technical sector or straightforward retail establishments.
As you consider your options, remember to include those who will benefit most from the event. From your mentors to your ideal customers, you should mark all of your prep work with an official affair.
Land your first sale
Your first sale will be one for the books, but hopefully it’s just a small drop in the bucket of what’s to come. As your customers come and go, it’s important to keep up with the quality of your goods or services. If you start to see a dip in anything from online reviews to revenue, it may be time to tweak or revamp your business model.
Conclusion
New Hampshire is undoubtedly one of the more business-friendly states in the nation, but you’ll still want to lay the right groundwork before you open your business. Now that you’ve completed all the steps, all you need to do is keep tapping into the snowball momentum that you built from day one.
FAQ
It costs about $100 to register your business, though you’ll pay additional fees if you’re registering more than one business name under the company umbrella.
Yes, you can use your home address as your business address. This is a good option for companies with low overhead, like a consulting company, or for online business retailers who can store stock in their homes.
Yes. New Hampshire is a largely hands-off state, meaning that business owners won’t necessarily have to fight through endless red tape to get basic needs met. In addition, the taxes, permits, and license laws are logical and fairly easy to follow. However, the actual process can vary based on your location, so you’ll need to do some research into the city or cities you’re targeting.
No, you can register as a sole proprietorship or partnership. Most small businesses choose LLCs because they limit their liability and protect their personal assets.
No. Instead, New Hampshire has a profit and enterprise tax for business owners, both of which include thresholds and rates that are subject to change.